Fudge Factor

(post by Jason) When Melissa and I started boarding retired horses we went through all the business start up costs and income/expense projections that she highlighted in her last couple FAQ posts. The one thing that she didn’t mention was what we call the fudge factor, or at least we call it that on a good day. Nobody starts a business thinking about fudge factors but it is a lesson every business owner very quickly learns to pay attention to and plan for.

It goes like this. After all the income is tallied and after all the projected expenses are properly accrued there are always a host of unforeseen, unaccountable expenses and cost increases. You need to be aware that they are going to happen and you need to build them into your cost structure or you are going to get stuck in a world of hurt very quickly. “Oh fudges” are the stuff of life and they are not rare. Roofs spring leaks, truck and tractor engines blow when they shouldn’t, equipment requires expensive and unforeseen repairs at extremely inopportune times. Even excellent clients occasionally forget to send a cheque and of course it only happens when you were really counting on the money to arrive in order to pay a bill ! At the end of the day all businesses have to be somewhat selective about passing costs on to clients. If we raised the board bill every single time we faced a cost increase or a large, unforeseen expense we would very quickly run out of clients.

“Oh fudges” happen outside the realm of accounting and expenses too. Employees get sick or don’t show up, vendors run short of critical supplies, parts that were supposed to be sent overnight mail take a week to show up, etc. These sorts of “Oh fudges” aren’t business killers so much as they are just plain frustrating.

Life is full of, “Oh fudges” and the best remedy we’ve found to deal with them is to try and keep a sense of humour. If you’ve ever wondered why so much country music is about farming and farm country this blog post should help clear that up.

The Truck Broke Down, The Baby’s Sick, The Cheque is Late, The Horse is Down and It’s Only Monday aren’t the top five hits on Billboard’s country charts yet. However if someone hands me a guitar they might be chart toppers soon ! Flatt and Scruggs I am not but I do have an unexpected flat tire to pay for !

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Winston and Faune showing off the dirty look